Agronometrics Shorts: The Global Coalition of Fresh Produce Releases Preliminary Report on Costs of Production

The Global Coalition of Fresh Produce recently released the findings of its survey, undertaken in the spring of 2023, aimed at shedding light on the escalating costs of fruits and vegetable production on a global scale. The survey’s objective was to draw attention to the far-reaching implications of these rising costs, affecting not only the entire produce industry but also end consumers. The respondents in North America highlight rising labor costs as a pressing challenge, with selling prices rising 19% on average in the past two years. 60% of respondents report selling price increases failing to match production and operating cost rises. Import competition, retailers’ resistance to price increases, and reduced consumer demand for fruits and vegetables are cited as reasons for their inability to command higher prices. The majority face financial strain, with 14% operating at a loss, while only one-third experience improved sales margins. The escalating costs have also impacted investments, leading to reluctance to invest and strategic limitations. Half expect costs to decline, but the other half anticipates continued escalation, especially in labor, utilities, and raw materials. Respondents unanimously agree that there has been a significant increase in production and operating costs over the past two years.

Commodity Prices by history (As Reported) in the US